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A firm explained that demand for an item in his company is Normally distributed with a mean of 2,000 units a month and standard deviation
A firm explained that demand for an item in his company is Normally distributed with a mean of 2,000 units a month and standard deviation of 50 units. They check stock every three months and lead time is constant at one month. They use an ordering policy that gives a 95 percent service level, and wanted to know how much it would cost to raise this to 98 percent if the holding cost is 30a unit a month
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